Microstrategy’s Michael Saylor Urges Argentines to Embrace Bitcoin Despite Criticisms of High Volatility

"Micheal Saylor Urges Argentinians to Embrace Bitcoin as a Solution to Inflation Woes, But Critics Remain Skeptical"

Microstrategy founder, Michael Saylor, has urged Argentinians to consider Bitcoin as a means of protecting their wealth amid the country’s economic turmoil. Saylor’s comments come as the Argentinian peso continues to depreciate, with the currency losing more than 40% of its value over the past year. Saylor tweeted that those living in Argentina “need Bitcoin” and shared news about the country’s inflation rate, which recently topped 7.58% per day. While some Argentinian politicians have suggested replacing the peso with the US dollar, Saylor’s followers on Twitter have voiced their support for Bitcoin as an alternative. However, critics have argued that Bitcoin’s volatility makes it unsuitable for use as a currency in Argentina.

Saylor’s tweets come as presidential aspirant Javier Milei has suggested that dollarization could help to curb inflation in Argentina. Milei, who is considered a frontrunner in presidential elections taking place in October, has said that he plans to shut down the central bank before beginning the dollarization process. Steve Hanke, a professor of applied economics at Johns Hopkins University, has also suggested that dollarization is the only way for Argentina to escape its current predicament. Despite this, critics of the US dollar have voiced their support for Saylor’s call for Argentinians to consider Bitcoin as an alternative.

Some of Saylor’s Twitter followers have argued, however, that Bitcoin’s volatility makes it an unsuitable alternative to the peso at present. One user suggested that a bitcoin-backed stablecoin could be a solution, but that more needs to be done before this becomes a viable option. Critics of dollarization have also argued that it would be an expensive undertaking and would result in the country’s central bank becoming subservient to the policies of the US Federal Reserve. Additionally, dollarization would see the country’s central bank losing seigniorage, the profit earned from printing currency.

A policy brief published by the Policy Center for the New South has described the calls for dollarizing the Argentinian economy as the “revival of a zombie idea.” The brief warned that the country’s fiscal imbalances would not be eliminated by dollarization and that it would require “a selective default of domestic currency liabilities, a brutal devaluation, and/or a unilateral conversion of public deposits.”

Saylor’s comments have sparked a debate about the future of Argentina’s economy and the role that Bitcoin and other cryptocurrencies could play in it. While some see Bitcoin as a viable alternative to the peso, others argue that its volatility makes it unsuitable for use as a currency. With the country’s economic situation continuing to deteriorate, it remains to be seen what steps its leaders will take to address the crisis.

Disclaimer: This article is for informational purposes only and is not intended as investment, tax, legal, or accounting advice. Neither the author nor Bitcoin.com is responsible for any losses or damages caused by or alleged to be caused by the use of or reliance on any content, goods or services mentioned in this article.

Martin Reid

Martin Reid

Leave a Replay

Scroll to Top